Rail Contract Negotiations Resume

Negotiations between major U.S. railroads and their unions resumed on Aug. 22 in an effort to reach an agreement on a new contract.

The National Carriers Conference Committee, which represents railroad management, and a coalition representing 12 rail labor unions faces a Sept. 16 deadline to reach a new contract.

If a new pact is not reached by then either side is free by law to engage in self-help, which means a strike in the case of the unions or a lockout in the case of railroad management.

A presidential emergency board on Aug. 18 released a series of recommendations for a new contract. The recommendations addressed wages, benefits and work rules affecting 125,000 unionized rail workers.

Any agreement reached on or before Sept. 16 would be subject to ratification by union members.

The two sides also could agree to extend the deadline to reach an agreement beyond Sept. 16 if they believe a new pact might be within reach.

A report posted on the website of the trade magazine Railway Age noted that two of the unions have distributed to their members information pertaining to what the unions described as misinformation that has been circulating among the rank and file about the recommendations issued by the PEB.

Among the misinformation is that railroad workers are quitting their jobs in large numbers and that there are few applicants for railroad jobs.

On the latter point, the information provided by the unions said that it is true that the number of applicants in remote and sparsely populated areas have been few, but railroads have sought to compensate for that by offering relocation bonuses and other incentives.

Otherwise, the railroads have said they have been receiving more than 42 applicants for each open position.

As for the rate of attrition, during the first six months of 2022, the voluntary “quit rate” was between 2 percent and 3.7 percent.

By comparison the quit rate reported by the U.S. Bureau of Labor Statistics for the transportation, warehousing and utility sector was 13.1 percent during the same period.

The fact sheets were distributed by he Brotherhood of Locomotive Engineers and Trainmen, and the  Transportation Division of the International Association of Sheet Metal, Air, Rail and Transportation Workers.

The Railway Age article can be read at https://www.railwayage.com/news/peb-250-correcting-misinformation-in-labor-ranks/

Rail PEB Seems to Split Differences in Report

The presidential emergency board appointed to recommend a settlement of the contract talks between Class 1 railroads and their unions has decided to split the differences.

Various news reports, including those by Trains magazine and the Reuters news agency, said the PEB is recommending that the railroads drop their demand that conductors be removed from locomotive cabs but also recommended pay increases that are well below what the unions were seeking.

If both sides agree to adopt the PEB recommendations, workers would receive a 22 percent pay hike over the life of the contract as well as $1,000 in service recognition bonus payments per year over the five years of the contract. The two sides could also agree to use the PEB findings as a basis for a new contract agreement.

The unions, which represent 115,000 railroad workers, had reportedly sought a 28 percent pay increase while the carriers offered 16 percent.

The PEB’s recommended pay increase works out to between 4 percent and 7 percent a year through 2024. Workers would receive back pay increases of 3 percent for 2020 and 3.5 percent for 2021.

Workers should receive an additional paid day off each year, the PEB recommended.

As for health care benefits, the PEB recommended what it termed modest changes that would include no reductions in benefits or a shift in cost-sharing, aside from a previously agreed upon 15 percent employee contribution per month.

The recommendations called for railroads and their unions to continue negotiating over the scheduling of work shifts for train and engine workers and if no agreement can be reached submitting the issue to binding arbitration.

Along those lines, the PEB recommended that the matter of making conductors ground-based positions be negotiated at the local rather than national level.

By federal law, work stoppages are prohibited for the next 30 days. If one or both of the parties in the contract impasse rejects the PEB findings, they will be free to either strike, in the case of the unions, or lock out workers in the case of railroad management.

If one or both of those occur, Congress could step in and impose a settlement.

Contract talks began in early 2020. By law, railroad contracts never expire but can be amended from time to time.

Historically, contract talks often take years to resolve. The last national railroad strike occurred in 1992.

The three-member PEB was appointed by President Joseph Biden in July and given a month to investigate the contract situation and issue recommendations for a settlement.

An article about the PEB recommendations can be found at the website of Trains magazine at https://www.trains.com/trn/news-reviews/news-wire/presidential-emergency-board-issues-rail-contract-recommendations-meant-to-avert-strike/

The article includes a link to download the PEB report.

Unions, Railroad Far Apart in Contract Proposals

As a presidential emergency begins to investigate the contract dispute between major U.S. railroads and their labor unions, it is finding the two sides are far apart  on wages and medical benefits.

The PEB began hearings on Sunday and the proposals they received from the two sides show a wide gulf between what unions want in wages and benefits and what the railroads are proposing to pay.

As reported by Trains magazine on its website, the unions want a 31.2 percent wage increase compounded over five years retroactive to Jan. 1, 2020.

The railroads have countered with a 17 percent compounded increase over the same term.

The Trains report cited a fact sheet released by Union Rail Unions, which represents the unions.

On a per year basis, the management offer calls for wage increases of 2 percent or 3 percent, except for a 6 percent increase in 2022.

The unions are seeking wage hikes of 6 percent in 2020 and 2021, 8 percent in 2022, and 4 percent in each of the final two years.

As for medical benefits, the unions want to maintain the status quo on the monthly worker contribution to healthcare, which is now $228.89.

Railroad management wants to increase the worker contribution to $321 while increasing the deductibles, coinsurance, and out-of-pocket maximums for individuals and families.

The PEB is expected to release its recommendations on or before Aug. 15.

The two sides can accept or reject those recommendations. If the latter occurs, neither side can engage in a strike or lockout for another 30 days.

Biden Names PEB Members

Three members of a presidential emergency board have been named by President Joseph Biden.
they are Ira Jaffe, as chair, and members David Twomey and Barbara Deinhardt,

The board will investigate over the next 30 days the impasse over a new labor contract between major railroads and their unions and make recommendations for resolving the stalemate.

The railroads and unions can accept or reject the recommendations.

If the latter happens, there will be another 30-day period before the 13 unions can strike or management can lock out its employees. That could occur as early as Sept 18.

If either a strike or lockout occurs, Congress could step in and order an end to the strike or the lockout. Congress could also impose terms of a new contract.

Jaffee is a lecturer in law at The George Washington University who has served as a neutral arbitrator in labor disputes since 1981. He has been named to various PEBs by presidents George W. Bush and Barack Obama.

Twomey is a law professor at Boston College and the author of textbooks on labor, employment and business law. He has served on seven previous PEBs.

Deinhardt is an independent arbitrator who has chaired the New York State Employment Relations Board and State Workers’ Compensation Board. She served as a member of PEB No. 248 and was appointed to three successive terms on the Foreign Service Grievance Board and one PEB.

The PEB appointed by Biden last week in an executive order will review the wage, benefits and work rules that are in dispute.

CSX is participating in the national contract talks only on fringe benefits and is negotiating separately on wages and work rules with two of its unions, BLET and SMART-TD. Canadian Pacific is negotiating separately with all of its unions.

Biden to Appoint PEB in Rail Contract Dispute

President Joseph Biden on Friday signed an executive order creating a presidential emergency board thus putting off for at least 60 days the prospect of a national railroad strike or lockout.

Had Biden not signed the order railroad labor unions would have been free to strike as early as Monday. Likewise, the nation’s major railroads could have locked out their workers on the same date.

The PEB will take 30 days to investigate issues of wages, benefits and work rules, and issue recommendations that both sides can accept or reject during another 30-day period.

Under federal labor law if either side rejects the findings of the PEB they can strike in the case of unions or impose lockouts in the case of railroad management.

The carriers and their 12 labor unions have been negotiating without success for a new contract for more than two years.

The dispute went to the National Mediation Board earlier this year but in June it declared the talks were at an impasse.

Members of the PEB have yet to be announced but by law they must not have connections to either labor or the railroad industry.

Historically, findings of PEBs have been the basis for a negotiated contract settlement.

If that is not the case, then Congress can order railroads to resume operation.

In voting for a “back to work” order Congress can and has in the past followed third-party settlement terms. Unlike the terms recommended by a PEB, those imposed by Congress would be binding.

There is some thought that the labor unions are hoping to do better in a “political settlement” by Congress than through mediation or at the bargaining table.

The two sides continue to be at odds over wages, benefits and work rules. In particular, the railroad industry wants to change work rules to provide for roving conductors who would be responsible for multiple trains rather than having a conductor onboard every train.

The creation of the PEB means that the earliest that a strike or lockout could occur is Sept. 18.

Under the Railway Labor Act, railroad contracts never expire but can be amended periodically. The latest railroad negotiations began in January 2020.

In a related development, another major railroad labor union announced it is leaning toward authorizing a strike.

The SMART Transportation Division said in a letter posted on its website that the union’s general committees so far have shown unanimous support for a strike if necessary.

The union said no strike authorization can be issued while a PEB is conducting its investigation.

The SMART-TD announcement came after the Brotherhood of Locomotive Engineers and Trainmen said its members voted to authorize a strike.

Shippers Urge Creation of PEB in Contract Talks

In a letter sent to President Joseph Biden, a group of rail shippers has asked for the appointment of a Presidential Emergency Board to step into the contract talks between the nation’s largest railroads and the unions that represent their workers.

The contract talks have drug on for more than two years and have reached a stalemate.

The shippers fear the situation will result in a strike later this year that the shippers said would further exacerbate the supply chain congestion of the past year.

A presidential emergency board would not have authority under federal law to impose a contract settlement, but Congress could step in and halt a strike or lock out if it gets to that.

A presidential board would investigate and make recommendations for a settlement.

The shipper coalition includes groups representing agriculture producers, manufacturers, refiners and energy producers.

Their letter said that in past contract disputes, the PEB’s recommendations have led to the parties agreeing to a new contract based on those recommendations.

Among the groups signing the letter were the CEOs of the American Chemistry Council, American Fuel and Petrochemical Manufacturers, American Petroleum Institute, National Association of Chemical Distributors, National Grain and Feed Association, and The Fertilizer Institute.